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New Android App Could Hurt Google's Ad Revenue

Published by: Mike Goldman on 26th May 2015 | View all blogs by Mike Goldman

New Android App Could Hurt Google's Ad Revenue

 A German company released a new mobile browser this week that has execs over at Google concerned about their biggest source of revenue. Based on the Firefox browser, the new AdBlock browser allows Android users to search the web without seeing the mobile ads that Google earns most of its income through. The app is currently in beta, and comes from Eyeo, the same German firm that developed AdBlock Plus, a PC-based ad-blocking browser extension. According to PageFair, some 28 percent of Internet-using Americans use AdBlock Plus, costing Google a whopping $887 million in ad revenue in 2012. While only 2 percent of the company's ad revenue that year, the total was enough that Google paid Eyeo to “whitelist” some ads. If the mobile version catches on, it could cost Google even more as Americans increasingly turn to mobile devices for their online browsing.

 The new AdBlock browser isn't Eyeo's first run at blocking online ads on Android devices, but a previous AdBlock app for Android only worked on “jailbroken” devices. The app only reached a small tech-savvy crowd, but that was enough to prompt Google to pull the app from the Play Store in 2013. It's likely the new app won't be made available on Google's marketplace, either, so users will have to download and install the app manually. In a press release, Eyeo pointed out that loading of mobile ads accounts for about 23 percent of battery use on mobile devices, and can increase data charges and cause pages to load more slowly. The company also noted that malware is often hidden behind ads, even on trusted networks, and the best security is to block these ads.

 

 Should Eyeo's new browser make a significant impact on Google's revenue, advertisers could start to pull ads or demand lower pricing. In addition, Google's ability to track user behavior across mobile devices could be affected. The browser could also have an impact on revenue for online advertising rivals like Yahoo and Microsoft.

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